SHANGHAI, July 20, 2017
/PRNewswire/ -- Ossen Innovation Co., Ltd. (the "Company") (Nasdaq:
OSN), a China-based manufacturer
of an array of plain surface, rare earth and zinc coated
pre-stressed steel materials, today announced that it has entered
into a Share Exchange Agreement (the "Exchange Agreement")
with America-Asia Diabetes Research Foundation (the "Foundation"),
a California corporation that owns
90.27% of the equity interests of San MediTech (Huzhou) Co. Ltd.
("San MediTech"), a China-based
medical device company engaged in the research, development and
marketing of glucose control products, and the shareholders of the
Foundation (the "Selling Shareholders"). Pursuant to the
Exchange Agreement, the Company has agreed to acquire all of the
issued and outstanding equity interests of the Foundation in
exchange for up to 81,243,000 of the Company's ordinary shares (the
"Acquisition").
Transaction Details
Upon completion of the Acquisition, the Company will indirectly
own 90.27% of San MediTech. San MediTech's proprietary Dynamic
Glucose Monitoring System ("DGMS") provides continuous, real-time
monitoring of glucose level in diabetes patients.
In addition, the Company entered into an agreement (the
"Spin-Off Agreement") to spin-off its existing pre-stressed steel
manufacturing business, including all existing liabilities,
immediately following the completion of the Acquisition. Pursuant
to the Spin-Off Agreement, an entity affiliated with Dr.
Liang Tang, Chairman of the Company,
will acquire all of the equity of the Company's wholly-owned
subsidiary, which indirectly owns all of the Company's existing
operating subsidiaries, in exchange for the forfeiture and
cancellation of all 11,850,000 ordinary shares of the Company
currently held by Dr. Tang (the "Spin-off Transaction").
An aggregate of 28,095,454 of the Company's shares will be
deposited in escrow at the closing of the Acquisition including (i)
24,372,900 of such shares (the "earn-out shares") subject to
forfeiture in the event that the post-combination company fails
after the closing to achieve RMB 44
million of revenue in 2017 and (ii) an additional 3,722,554
of such shares subject to forfeiture in the event that the
Company's representative under the Exchange Agreement
successfully brings an indemnification claim under the Exchange
Agreement on behalf of the Company's shareholders.
It is anticipated that, following completion of the Acquisition
and the Spin-Off (collectively, the "Transactions"), the Company's
existing shareholders (excluding Dr. Tang) will retain an ownership
interest of approximately 8.9% of the Company (or
approximately 12.25% in the event that the earn-out shares are
forfeited), current members of the Company's management or
affiliates of the Company (excluding Dr. Tang) will own
approximately 1.35% (or approximately 1.85% in the event that the
earn-out shares are forfeited), and the selling shareholders of
AADRF will own approximately 91.10%, of the outstanding equity of
the Company (or approximately 87.75% in the event that the earn-out
shares are forfeited).
The Transactions are subject to the satisfaction of customary
closing conditions, including shareholder approvals and the
Company's continued listing on the Nasdaq Capital Market. The
Transactions are expected to close promptly following the Company's
special shareholders' meeting to approve the Transactions.
The description of the Transactions contained herein is only a
summary and is qualified in its entirety by reference to the
Exchange Agreement and the Spin-Off Agreement, copies of which will
be filed by the Company with the Securities and Exchange Commission
(the "SEC") as exhibits to a Report on Form 6-K.
About America-Asia Diabetes Research Foundation
America-Asia Diabetes Research Foundation is a California corporation which conduct its
business through its subsidiary, San MediTech (Huzhou) Co., Ltd.
San MediTech, based in Huzhou City, China, engages in the research, development
and marketing of glucose control products. San MediTech's
proprietary DGMS provides continuous, real-time monitoring of
glucose level in diabetes patients, with two patents granted in
China and several patents pending
both in China and the U.S. DGMS
has been approved by the China Food and Drug Administration and has
entered into clinical trials in the U.S. for DGMS. For more
information about San MediTech, please visit:
www.sanmeditech.com.
About Ossen Innovation Co., Ltd.
Ossen Innovation Co., Ltd. manufactures and sells a wide variety
of plain surface pre-stressed steel materials and rare earth coated
and zinc coated pre-stressed steel materials. The Company's
products are mainly used in the construction of bridges, as well as
in highways and other infrastructure projects. Ossen has two
manufacturing facilities located in Ma'anshan, Anhui Province, and Jiujiang, Jiangxi province.
Additional Information About the Transactions and Where to
Find it
The Transactions will be submitted to shareholders of the
Company for their approval. In connection with that approval, the
Company intends to make available to shareholders a proxy statement
containing information about the Transactions. The Company's
shareholders are urged to read the proxy statement and any
amendments thereto in connection with the Company's solicitation of
proxies for the special meeting to be held to approve the
Transactions, because these documents will contain important
information about parties to the Agreement and the Transactions.
Shareholders will also be able to obtain a free copy of the proxy
statement, as well as other filings containing information about
the Company, without charge, at the SEC's website
(www.sec.gov).
Participants in the Solicitation
The Company and its directors and executive officers and other
persons may be deemed to be participants in the solicitations of
proxies from the Company's shareholders in respect of the
Transactions. Information regarding the Company's directors and
executive officers is available in its annual report on Form 20-F
filed with the SEC on April 10, 2017.
Additional information regarding the participants in the proxy
solicitation and a description of their direct and indirect
interests will be contained in the proxy statement when it becomes
available.
Disclaimer
This communication shall not constitute an offer to
sell or the solicitation of an offer to buy any securities, nor
shall there be any sale of securities in any jurisdiction in which
the offer, solicitation or sale would be unlawful prior to the
registration or qualification under the securities laws of any such
jurisdiction. No offering of securities shall be made except by
means of a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended.
Forward-Looking Statements
This press release may contain forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended, and as defined in the U.S. Private Securities
Litigation Reform Act of 1995. These forward-looking statements
involve inherent risks and uncertainties that could cause actual
results to differ materially from those projected or anticipated,
including risks outlined in the Company's public filings with the
Securities and Exchange Commission, including the Company's annual
report on Form 20-F. Furthermore, there can be no assurance that
the Transactions will be approved by shareholders or that the
conditions to close will be satisfied or waived. All
information provided in this press release is as of the date
hereof. Except as required by law, the Company undertakes no
obligation to update or revise publicly any forward-looking
statements, whether as a result of new information, future events
or otherwise, after the date on which the statements are made or to
reflect the occurrence of unanticipated events.
For more information, please contact:
Ossen Innovation Co., Ltd.
Wei Hua, Chief Executive Officer
Phone: +86-21-6888-8886
Web: http://www.osseninnovation.com
Investor Relations
Weitian Group LLC
Phone: +1-732-910-9692
Email: tony.tian@weitian-ir.com
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SOURCE Ossen Innovation Co., Ltd.